Capital gains tax will 'decimate' Kiwi start-up industry - Rocket Lab founder Peter Beck

Rocket Lab founder Peter Beck isn't a fan of the Tax Working Group's recommended capital gains tax system.

"Just saw the NZ capital gains tax recommendations," Mr Beck said on his Twitter account.

"Taxing IP and stock will decimate the already fragile NZ start up industry. NZ already has big problems around creating large valuable technology companies and this will not help."

Despite its Kiwi founder and large presence in New Zealand, Rocket Lab is actually an American company based in Los Angeles, with a "wholly-owned New Zealand subsidiary". Its investors include ACC, weapons manufacturer Lockheed Martin and the Australian sovereign wealth fund, as well as various venture firms, including Warehouse millionaire Stephen Tindall's K1W1.

One of Beck's followers sarcastically said it was a "surprise" to see a "complaining millionaire" opposed a capital gains tax. Mr Beck rejected this characterisation of his view.

"A concerned citizen eager to support an economy of high value technology companies that employ lots of people and do great things," he replied.

Economist Bernard Hickey replied to Mr Beck, saying his view shows why a land tax may have been a better way of achieving a more equitable tax system.

Rocket Lab manufactures its rockets in California, though most of its employees are based in New Zealand, NBR reports. Beck says there are no plans to change that setup, with Mahia Peninsula also set to remain its primary launch site.

"Look, we've been an American company and proud of it for many years," he told NBR last year.

"The New Zealand element is very important and very special to us but we never tried to hide the fact we're a US company and this is where New Zealand companies go wrong in the fact that if you want to be a large, successful global company, it's very difficult to be that out of New Zealand."

Mr Beck last year said he hoped the company would be "cash-flow positive" soon, after more than a decade of preparation.

Newshub.

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